Bolivian government takes back control of hydrocarbons

The recent announcement by the Evo Morales government in Bolivia of the “nationalisation” of the country’s hydrocarbon resources has shaken the multinationals. This move, although in reality not complete nationalisation, is a reflection of the overall revolutionary wave sweeping across Latin America.

The decision of the Bolivian government
on May 1st to take over the gas resources of the country,
and its high profile implementation by sending troops to occupy the
fields and installations has shaken the multinational companies.

Speaking at a May Day rally at Plaza
Murillo, vice president Garcia Linera, announced the nationalisation
with the following words: “the government of the people, the
government of the workers, has taken the most important decision of
this century: this is the first nationalisation of the 21st
century”.

The measure, implemented through
Supreme Decree 28701 that clearly states that, “as a measure of
national sovereignty, and following the mandate of the Bolivian
people… The natural hydrocarbon resources of the country are
nationalized… The State recovers absolute and total control,
property and possession of these resources”. From May 1st
the different oil companies that operate in the country are forced to
give ownership of their whole production to the state owned company
YPFB, which “in the name and in representation of the state,
exercising in full its ownership of all hydrocarbons produced in the
country, takes over its commercialisation, defining conditions,
volumes and prices both for the internal market as well as for export
and industrialisation”.

To reinforce the measure, the
government ordered the army into all the oilfields and installations.
Evo Morales himself, wearing a hard hat, personally supervised the
operations in an oilfield operated by the Brazilian Petrobras, one of
the largest multinational companies in the gas market in Bolivia.
"The time has come, the awaited day, a historic day in which
Bolivia retakes absolute control of its natural resources," he
said, as soldiers erected banners saying “Nationalised, property of
the Bolivians”.

The move certainly took the oil
companies by surprise, since they expected the Evo Morales government
to renegotiate the contracts under which they are operating, but they
thought he would do it through talks and negotiations, rather than by
imposition. The oil companies have really no reason to complain. They
have been operating in Bolivia under an extremely favourable tax and
royalty regime set up under the hated government of Gomez de Lozada.
Many of the contracts are actually considered to be illegal and void
since they were never ratified by parliament.

The decision comes after Evo Morales’
visit to Cuba, where he signed a number of agreements with Fidel
Castro and Hugo Chavez. This is clearly part of a concerted effort
against the Free Trade of the Americas Agreement, proposed by
Washington, which in effect would mean a free ride for US
multinationals in the whole of the continent. Due to opposition by
Venezuela, the FTAA, which was supposed to have been signed on
January 2005, has completely failed, and the US has moved
towards the signing of bilateral free trade agreements with Central
American and Andean countries. This led, just over a week ago, to the
withdrawal of Venezuela from the Andean Community of Nations (CAN),
since it correctly argued that if Colombia and Peru, which are part
of CAN, sign FTA with the US, then this amounts to back-door FTAs
with the whole of the CAN nations.

The move will particularly hit
Brazilian multinational Petrobras and Spanish multination Repsol,
which are the main players in Bolivia’s lucrative gas business.
This is however, not a full nationalisation, and therefore, less
radical than the nationalisations of the mines in 1937 and 1969. The
state takes over controlling stakes in all companies (51% of the
shares), but does not actually fully nationalise them. The argument
is that the Bolivian state does not have the necessary technology and
know-how to exploit these resources. In the new contracts proposed,
the Bolivian state will receive 82% of all revenue through taxes and
royalties, decisively shaking the balance in favour of Bolivia. There
are many legal aspects of the decree that need to be studied more in
detail. But even in the worst possible scenario that at the end of
the day this would only amount to a change in the contracts under
which foreign multinationals operate in the country, this would still
be a progressive step forward.

The move has been received with an
outcry by the Bolivian oligarchy and by the multinationals concerned.
The usual threats have been made that this will damage foreign
investment and that the multinationals might just leave the country
altogether. Thus, even this halfway nationalisation is too much for
the interests of the multinationals and sets the Bolivian government
on a collision course with them.

As we said at the time of the election
victory of the MAS in December 2005, the Evo Morales government
cannot serve two masters at the same time, and it is subject to
enormous pressures on the one hand from the revolutionary movement of
the workers and peasants (which is what finally catapulted Morales to
power, though he played no decisive role in it), and from the
oligarchy and the multinationals on the other. Every step he takes to
shift the balance of power in favour of the workers will be seen as a
provocation on the part of the oligarchy, no matter how many speeches
he makes to reassure foreign investors.

This move, which shows boldness and
confidence on the part of the Bolivian government, cannot be
understood outside of the framework of the revolutionary wave which
is sweeping across Latin America. Without the existence of the
Bolivarian Revolution in Venezuela which in turn has broken the
blockade on Cuba, a government like that of Evo Morales would have
never dared to take measures of this kind.

Regardless of the legal details and the
scope of this semi-nationalisation, this is clearly a step forward
for the movement of workers and peasants in Bolivia and throughout
the continent, and has been seen as such. This is a move that will
increase the confidence of the poor masses in Bolivia and will push
them towards putting even more pressure on the Evo Morales government
to nationalise not only gas, but also the mines, the land, the
bankrupt national airline LAB, etc.

In fact, Evo Morales himself declared:
“This is only the beginning. At the end of May we will nationalise
other energy resources… we are starting with hydrocarbons, tomorrow
we will move to mining, forestry and all of the natural resources.”

These steps are taken in the logic of
developing national “Andean capitalism”, to use the turn of
phrase coined by Morales’ vice president Garcia Linera. But the
problem is that the main contradiction in Bolivia is precisely that
there is no national capitalist class separate and independent from
the landowners and the multinationals. Any attempt to create such a
national capitalist development on the basis of the state will
inevitably lead to a head on clash with the real capitalists, the
owners of the banks, industries, mines and the land, which form an
inseparable block with imperialist interests. The choice is a stark
one: either socialism or imperialist domination.

Unfortunately, the leaders of the mass
movement of the workers in Bolivia do not seem to have learnt any of
the lessons from the election of Evo Morales. First, the leaders of
the Bolivian Workers Union (COB) did not take advantage of two
revolutionary opportunities, in October 2003 and in May June 2005.
They even admitted themselves that if on those occasions the workers
did not take power this was only because of the lack of a
revolutionary leadership. Then, inevitably, the movement was derailed
onto the electoral plane. Instead of putting forward workers
candidates and at the same time giving critical support to Evo
Morales, the leaders of the COB took the unfortunate decision of
arguing for a boycott of the elections. They went as far as to say
that neither Morales nor the candidate of the oligarchy would solve
the problems of the workers and that therefore there was nothing to
choose between them.

The masses of workers and peasants had
a clearer class instinct and voted massively for Evo Morales. In the
epicentre of the revolutionary uprisings, the working class city of
El Alto, nearly 80% voted for Morales and the MAS. This was treated
as if it were an irrelevant detail by the leaders of the COB,
particularly Jaime Solares, who continued with an ultra-left line
which was completely out of touch with the masses of workers and
peasants. This was clearly demonstrated on April 21 when they could
only gather a couple of hundred people at a demonstration they had
called in La Paz as part of a so-called “general strike” against
the Morales government. Instead of having a policy of organizing the
workers to struggle for their demands to put pressure on the Morales
government (which they consider as their own) to deliver on its
promises and even go further, they pursued a policy of ultimatums
which cut them off even from even most of the advanced sections.

As a result, the May Day demonstration
called by the COB was noticeably smaller than the one called by the
MAS where the announcement of nationalization was made. The
forthcoming congress of the COB (which had to be delayed after the
fracas of the April 21 “general strike”) will be the setting for
a strong clash between the current leadership and the supporters of
the MAS.

In revolutionary periods, mistakes in
tactics and strategy can prove to be fatal. A genuine revolutionary
Marxist leadership can only be built in Bolivia by understanding the
real mood of the masses and their relationship with the Morales
government. Marxists must maintain their own political programme and
be clear on the main point: genuine sovereignty and control over the
natural resources to the benefit of the majority of Bolivians can
only be achieved through the nationalisation and democratic planning
by the workers themselves of the basic pillars of the economy, that
is, through the struggle for socialism. But before this can be
realized, they need to win over to their side the majority of the
workers and peasants who at the present time have put their trust in
Evo Morales. This can only be done by patiently explaining and
accompanying them in their struggle, by supporting every progressive
step taken by the government, while at the same time pushing the
movement forward.